Japan rice prices soar as core inflation accelerates

TOKYO

This photo taken on February 18, 2025 shows a man walking past sacks of government stockpiled rice piled up in a warehouse in Saitama prefecture, north of Tokyo.

Rice prices in Japan last month were almost twice what they were a year earlier, official data showed on April 18, as core inflation accelerated in the world's number four economy.

The price of the grain has soared in recent months, prompting Japan's government to release some of its emergency stockpile into the market.

Excluding fresh food, consumer prices rose 3.2 percent in March year-on-year compared to 3 percent in February, in line with market expectations.

Excluding energy as well, prices rose 2.9 percent last month, up from 2.6 percent in February. But overall inflation eased to 3.6 percent from 3.7 percent.

The data is likely to strengthen expectations that the Bank of Japan will hike interest rates, with inflation above the BoJ's target of two percent for almost three years.

The Internal Affairs ministry said that the prices of both fresh and non-fresh food products rose, as did hotel fees.

But grain prices saw the biggest increase, rising 25.4 percent.

Rice prices logged an enormous 92.5-percent jump, driven by a shortage of the staple.

Factors behind the shortfall include poor harvests due to hot weather in 2023 and panic-buying prompted by a "megaquake" warning last year.

Record numbers of tourists have also been blamed for a rise in consumption while some traders are believed to be hoarding the grain.

The government began auctioning its rice stockpile last month, the first time since it was started in 1995.

The rising prices have increased pressure on the government of Prime Minister Shigeru Ishiba to do more to help consumers.